If you are the owner of a company registered in the UK, get paid dividends, and would like to move to Spain, but you do not want to relocate your business, we have the solution for you.
The Non-Lucrative Visa is your perfect route, as it will allow you to reside in Spain and receive your dividends from your UK company. This visa is valid for one year but can be renewed. Please read about all the requirements here – long-stay visas in Spain.
If my clients are all UK-based, can I still invoice them in GBP once I move?
As the company is registered in the UK, you can still invoice your clients in GBP, as this matter does not depend on where you -personally- have your tax residency. Therefore, as your company tax residency is in the UK, this company can still invoice in GBP.
Will I have to pay my salary as Euros into a Spanish bank account?
You can still receive your dividends in GBP and do not need to open a Spanish bank account in order to be paid by your company. But, as a Spanish tax resident, you will need to declare your dividends in your annual Personal Income Tax declaration.
An individual is a resident in Spanish territory when stays more than 183 days, during the calendar year, in Spanish territory. To determine this period of residence, sporadic absences will be taken into account unless the taxpayer proves his tax residence in another country (by means of a tax residence certificate issued by the tax authorities of that other country).
Read more: Banking in Spain
Do I need an employment contract?
You do not need an employment contract if you are only paid dividends.
What are the rules for paying myself dividends?
You can be paid dividends from your UK company with no restrictions, except that you will need to declare the mentioned dividends as Income from Capital in your annual Personal Income Tax declaration. There is a Double Taxation Convention between Spain and the UK (2013 Spain-UK Double Taxation Convention – in force: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/507409/spain-dtc_-_in_force.pdf); therefore, you would be entitled to apply the deduction for international double taxation in Spain for Personal Income Tax.
Will I need to register my UK business in Spain?
The UK company does not need to be registered in Spain to pay dividends to its owner.
Do I need to declare my business earnings in Spain, or just my personal income?
As the company is registered in the UK, its business earnings must be declared in the UK. You, as a Spanish resident, will have to declare all the income received worldwide, taking into consideration the Double Taxation Conventions with Spain.
What is the process for declaring my personal income?
As has been pointed out above, you will have to declare your Personal Income Tax annually. In addition, you will have to declare all your income -dividends, interests, pensions, royalties, capital gains, etc.- received worldwide.
The Personal Income Tax declaration in Spain is filed from April to June of the year following the accrual year. We recommend submitting the declaration with professional assistance.
Contact us for more information and start your new life in Spain!